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Oct 27, 2009

Ligand to Buy Metabasis Through Deal Giving Acquired Firm’s Shareholders Continued Revenues

  • Ligand Pharmaceuticals is to acquire Metabasis Therapeutics for about $1.8 million net in cash plus four tradable contingent value rights (CVRs) per Metabasis share. The gross cash payment by Ligand has been set at $3.2 million and takes into account Metabasis’ net liabilities at closing and an amount to be deposited in the stockholders’ representative fund.

    The CVRs will entitle holders to additional cash payments relating to milestones, royalties, saleback, or licensing agreements linked to Metabasis’ existing projects including its HCV collaboration with Roche, its thyroid receptor beta-related hyperlipidemia and diabetes programs, the MB07133 product for hepatocellular carcinoma, and the company’s equity interest in PeriCor Therapeutics.

    Ligand has also committed at least $8 million in R&D funding for the Metabasis pipeline within 42 months following completion of the acquisition. Ligand president and CEO, John L. Higgins, claims the deal’s creative structure will be beneficial to both companies.

    “Ligand obtains numerous high-quality partnered and development-stage programs that will increase our revenue potential and expand our pipeline of proprietary assets. In exchange, the nonpartnered Metabasis programs will be advanced by a company with strong and proven research credentials, with the goal of generating cash proceeds payable directly to Metabasis stockholders.”
     
    Metabasis has been leveraging its technologies to develop new drugs for metabolic and liver diseases. In addition to a number of discovery-stage projects, the company’s in-house clinical pipeline includes the diabetes candidate MB07803 (Phase II), a thyroid receptor beta agonist (MBO7811) for the treatment of hyperlipidemia (Phase Ib), MB07133 in primary liver cancer (Phase I/II completed), and hepatitis B candidate Pradefovir (Phase IIb completed). 

    Metabasis’ discovery programs hinge on its HepDirect® and NuMimetic™ technologies. HepDirect is a prodrug technology designed to target drugs to the liver. In addition to its use for in-house drug development, the platform is also being exploited through collaborations with Merck & Co. and Idenix.

    The NuMimetic technology has been developed for the discovery of molecules that target liver enzyme nucleotide-binding sites. The platform includes a library of nucleotide mimetics for use in the discovery of novel compounds with potential against pathways involved in metabolic diseases. Besides its in-house use, the NuMimetic technology has also been leveraged as part of Metabasis’ collaboration with Merck to discovery new AMP protein kinase (AMPK) activators. In June the company announced that this four-year research collaboration yielded a lead preclinical candidate.

     



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